A personal loan agreement is a written contract between two parties (the lender and the borrower) that describes the amount of money being borrowed, the terms of payment, and how long the borrower has until he/she must repay the loan in full. This type of written contract is essential to pursuing the matter in court in the event that either party does not abide by its terms. At Tsang & Associates, we have the experience you need to draft a successful and comprehensive personal loan agreement. Our attorneys will assess your circumstances and assist you in preparing all of the necessary paperwork to create a personal loan agreement tailored to your needs. Consultations are free and we look forward to speaking with you.


We will prepare a comprehensive Personal Loan Agreement along with forms and supporting documents, including:

  • Advice on what terms of payment are best
  • Advice on the implications of certain interest terms
  • Verifying the amount in question to loan out

In short, we provide a start to finish service. Your case is safe with us until the case is complete. 



Free Consultation

*Legal Fees vary based on complexity of each case, and the above quoted price represents the amount we charge for a typical case. 


Once signed, a personal loan agreement is a legally binding contract. Standard contract law dictates that if one signs the contract and does not uphold its terms, they may be sued for breach of contract. In the event of such a lawsuit, one may be forced to pay damages and legal fees, so careful consideration and consultation of a third party is strongly advised before signing a personal loan agreement.

Loans vs Gifts:

When making a personal loan agreement with a family member or friend, there are several factors to consider. First of all, it is important to abide by the aforementioned procedure of drawing up a contract with interest and payment schedules which the lender and borrower have both signed off on. This makes the loan agreement a legally binding contract. If the loan agreement is in any way not a legal contract, the IRS will see it as a gift, which comes with its own consequences when it comes to tax laws.

Also, if the lender chooses not to charge the borrower interest on the loan, the IRS may see the interest income the lender could have earned as a gift to the borrower and choose to tax the lender on it. It is important to charge at least some interest in order to make it clear that the loan agreement is not a gift. The IRS will charge lenders on an interest-free loan if the interest he/she could have earned on the loan exceeds $14,000 when added to any other money given as a gift. 

Advantages/Additional Services




-Verification of assets


In order to provide you with the best and most accurate consultation, we recommend that you bring as many of the following information/documents as you can to ensure a productive meeting. 

  1. Amount of money being borrowed
  2. Schedule of installments/payments
  3. Terms of interest, if any
  4. Collateral being put up, if any
  5. Date the loan must be repaid in full
  6. Witness Names and addresses
  7. Name and address of any cosigners
  8. Penalties for late payments
  9. Options/procedures for selling the loan, should the lender so desire